Word: braniff
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...story to a congressional committee that is investigating conglomerate mergers. When Representative Emanuel Celler charged that LTV's debts exceed its salable assets by $171 million, Ling replied that the consolidated balance sheet was "not really meaningful." He reasoned that LTV's interests in some subsidiaries, including Braniff International Airlines and Okonite, a wire and cable maker, were undervalued because control of a company normally commands a premium over the market price of its stock. He also claimed that LTV's debts were over stated because the company does not guarantee most of the debts...
...Ling says, many of his company's nine subsidiaries were hurt by un foreseen events. The economic slow down cut Braniff's passenger traffic, a rise in copper prices hurt Okonite's prof its and the pullback in defense contracts reduced the earnings of both LTV Electrosystems and LTV Ling Altec...
Premium Rate. Ling has been liquidating other LTV holdings in order to meet his interest charges and bank loans. As he explains it, LTV will retire $112 million in loans due next year by selling either Braniff or Okonite, both of which Ling agreed to dispose of within three years in return for Justice Department withdrawal of the J. & L. antitrust suit. In February, LTV got $63 million by selling its holdings in Wilson Sporting Goods, and this too can be applied to the debt. Earlier this month, LTV Altec sold Allied Radio Corp. for $30 million. Meanwhile, Ling...
...company-Ling has seen his investment tumble by 59%. That Ling would now choose to get out of growth businesses and stay with a troubled company in a stagnant industry seems surprising. But LTV stands to collect some $17.5 million in dividends from J. & L. for last year, while Braniff paid only $5.1 million and Okonite $2.1 million...
...effect, the Justice Department simply approved of what Ling was already trying to do. Financially hard-pressed, he put LTV's 55% holdings in Braniff on the block several months ago. Now the trustbusters have given him three years to sell out. The merger trend in the airline industry should make Braniff relatively easy to dispose of. Wall Streeters think that Pan American and Eastern are potential buyers. On the other hand, LTV's unsuccessful attempt in January to sell Braniff to Norton Simon Inc. may indicate a desire to find a buyer outside the airline industry...